Large data center is proposed for former papermill
Merkle Standard, owned by Allrise Capital Inc., proposes converting a former papermill in Usk, Washington, into a data center requiring 225 megawatts of electricity. This proposal faces significant opposition from Pend Oreille County commissioners and the Kalispel Tribe of Indians due to concerns about massive power consumption, lack of transparency, and environmental impacts. The company previously failed to deliver on promises for a cryptocurrency mining operation at the same site.
Merkle Standard, a company owned by Irvine, California-based Allrise Capital Inc., is proposing to convert the former Ponderay Newsprint papermill in Usk, Washington, into a large data center. The facility, which closed in 2020, could eventually draw 225 megawatts of electricity, significantly more than the entire county's residential and small business usage combined. This plan has been met with strong opposition from local officials and tribal leaders, who express concerns over the immense power demands, potential environmental impacts, and a lack of transparency from the developer.
Pend Oreille County Commissioner Robert Rosencrantz stated that county commissioners have "heard absolutely nothing" officially about the proposal, questioning the company's approach. Curt Knapp, a retiring commissioner for the Pend Oreille County Public Utility District (PUD), voiced apprehension about data center developers targeting small towns and emphasized the PUD's commitment to protecting ratepayers. Deane Osterman, executive director of natural resources for the Kalispel Tribe of Indians, whose reservation is across the river from the proposed site, confirmed that Merkle Standard officials have not consulted with the tribe, raising questions about potential chemicals, emissions, and wastewater management.
The company's previous venture at the site, a promised large-scale cryptocurrency mining operation, failed to materialize and did not deliver the 140 jobs initially touted. Commissioner Rosencrantz expressed skepticism, noting that "data centers don’t create jobs. Then they fail, and the community is left holding the bag." The article also highlighted potential conflicts of interest among county officials, including Commissioner John Gentle, whose wife previously worked for a major cryptocurrency company and lobbied for a "cloud-based computing" center in Nebraska while her husband advocated for Merkle Standard.
The project's approval hinges on an existing conditional use permit for cryptocurrency mining, with an "open question" remaining as to whether it covers data center operations. PUD Commissioner Dave Rick acknowledged the growing demand for limited electricity supply in the Pacific Northwest, leading to a "spillover to Spokane and Pend Oreille County" as other regions face long waiting lists for power.